Indeed, but Chinese AI model companiea are harder to held accountable by the US than US companies, so there's some sense for the US to prefer national models over international ones.
If the US had comparable open models as the chinese ones, I would love to see more investment into them. But instead our government is operating a lot more in line with how individuals who stand to profit from the private frontier models would operate...
A Chinese company has less incentive to use US customer's data than a US company does. Does a Chinese company have an incentive to steal national secrets or cause disruption? 100%. But any firm or project that has national secrets should be vetting everything and using in-house software anyway. And if not, then if I were China I'd be trying to breach the makers of the software (in this case Anthropic,OpenAi,etc).
For the average person, China doesn't care about you or me. For a US company, US citizens are their gold mine.
If anything, the competition from a Chinese company will reduce a US company's possible profits. That's the threat. That's why Chinese EVs are banned in the US and why Chinese LLMs are next.
Just because something is made in China does not make it a threat to the US. The US trades all sorts of goods, produce, etc with China. The traded goods can be poisoned at any time. At what cost? Well we wouldn't be able to trade anymore. And that hurts both sides. But once a foreign nation does something better than a US firm, the US will put up a ban to protect its own stock market. This isn't new.